NEPRA is debating whether to increase hydel power plant prices by Rs4.15 per unit

On Thursday, the National Electric Power Regulatory Authority (NEPRA) said it would withhold judgment on WAPDA Hydroelectric’s request for the establishment of the power rate for the fiscal year 2022–2023.

According to specifics, WAPDA Hydroelectric’s appeal for a bulk supply rate for the fiscal years 2022–2023 was heard by NEPRA. Rafique Ahmed Shaikh and Maqsood Anwar, two NEPRA members, attended the hearing, which was presided over by Tauseef H. Farooqi, the organization’s chairman.

The NEPRA reports that WAPDA has asked for an increase in the power tariff of its 21 power units for FY 2022–23 from Rs3.68 per unit to Rs4.15 per unit. On Thursday, NEPRA concluded its hearing on the WAPDA Hydroelectric rate appeal for FY 2022–2023; nevertheless, NEPRA has postponed its judgment, which will be made after careful consideration of the facts.

Prior to this, WAPDA asked NEPRA to estimate its income needs at Rs. 121.808 billion for the current fiscal year (FY 2022-23), which is 20% more than what NEPRA had estimated at Rs. 101.382 billion for the previous fiscal year (FY 2021-22).

The following issues were thoroughly covered during NEPRA’s hearing on the bulk supply tariff appeal submitted by WAPDA Hydroelectric for FY 2022–2023:

1. Whether Petitioner’s request for allowance of O&M expense amounting to Rs23, 616 million justified?
2. Whether Petitioner’s request for allowance of depreciation charge amounting to Rs 8,025 million justified? Whether Petitioner’s request for allowance of WACC-based return on power stations amounting to Rs. 30,385 million justified?
3. Whether Petitioner’s request for allowance of WACC-based return on investment on power projects amounting to Rs. 34,265 million justified?
4. Whether other income claimed to be Rs767 million justified?
5. Whether Petitioner’s request for allowance of Regulatory Gap amounting to Rs. 26,285 million justified?
6. Whether the Petitioner’s request for payment of NHP at the uniform rate of Rs1.10 per kWh justified?
7. Whether WUC, at par with NHP paid to provinces at Rs.1.10 per kWh, for Mangla HPP, NJ HPP, and any other future public sector projects of AJK justified?
8. Whether PPRA guidelines/rules were followed during the procurement of goods/services under the project/plants?
9. Whether the claims under Tariff Petition are eligible payments i.e. as per approved PCI/approved contracts and government policies in vogue?
10. Whether it is justified to consider higher tariffs for small hydel plants being inefficient and with low plant factors?
11. Whether it is justified to consider capacity payment/hydrology risk for the plant for which full water discharge is otherwise available but the available water cannot be utilized due to delay in maintenance/design issues?
12. Whether the actual generation for FY 2021-22 and projected generation for FY 2022-23 justified?
13. Whether the expected annual generation and other technical parameters, claimed cost, and construction period for ongoing development projects under CWIP justified?

It should be noted that NEPRA was previously told that O&M costs had increased from Rs17.622 billion for FY 2021–22 to Rs23.616 billion for the current fiscal year due to revenue requirements.

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